EMERGENCY CREDIT LINE GUARANTEE SCHEME MODIFIED AND EXTENDED TILL 31.03.2022

EMERGENCY CREDIT LINE GUARANTEE SCHEME MODIFIED AND EXTENDED TILL 31.03.2022 Ministry of Finance vide press release 1759251 dated 29th September, 202…

CS Lalit Rajput

Oct 5, 2021

Last update on Oct 5, 2021

EMERGENCY CREDIT LINE GUARANTEE SCHEME MODIFIED AND EXTENDED TILL 31.03.2022 Ministry of Finance vide press release 1759251 dated 29th September, 2021 has extended the scope of ECLGS’ and scheme extended till 31.03.2022 or till guarantees for an amount of Rs. 4.5 lakh crore are issued under the scheme, whichever is earlier. Further, the last date of disbursement under the scheme has also been extended to 30.06.2022 to support various businesses impacted by the second wave of COVID 19 pandemic. EMERGENCY CREDIT LINE GUARANTEE SCHEME (ECLGS) launched by Government of India as a special scheme in view of COVID-19 crisis to provide 100% guarantee coverage to Banks and NBFCs to enable them to extend emergency credit facilities to Business Enterprises / MSMEs in view of COVID-19 to meet their additional term loan/additional working capital requirements. List of modifications have been made in the scheme to enable support to businesses impacted by the second wave of COVID:

a) Existing borrowers under ECLGS 1.0 & 2.0 would be eligible for additional credit support of upto 10% of total credit outstanding as on 29.02.2020 or 31.03.2021, whichever is higher.

b) Businesses who have not availed assistance under ECLGS (ECLGS 1.0 or 2.0), can avail credit support of upto 30% of their credit outstanding as on 31.03.2021.

c) Businesses in sectors specified under ECLGS 3.0, who have previously not availed ECLGS, can avail credit support up to 40% of their credit outstanding as on 31.03.2021, to the maximum of Rs.200 crore per borrower;

d) Incremental credit can be availed within these limits by existing ECLGS borrowers whose eligibility increased because of change in cut-off date to 31.03.2021 from 29.02.2020.

e) Accordingly, Borrowers who have availed assistance under ECLGS and whose credit outstanding as on 31.03.2021 (excluding support under ECLGS) is higher than that on 29.02.2020 shall be eligible for incremental support within the cap stipulated under ECLGS 1.0,2.0 or 3.0.

Source: Release ID: 1759251 Disclaimer: Every effort has been made to avoid errors or omissions in this material. In spite of this, errors may creep in. Any mistake, error or discrepancy noted may be brought to our notice which shall be taken care of in the next edition. In no event the author shall be liable for any direct, indirect, special or incidental damage resulting from or arising out of or in connection with the use of this information.

About Author

CS Lalit Rajput

Company Secretary

Lalit Rajput is a qualified Company Secretary and graduate with 5+ years’ experience in handling Secretarial and Compliance management. Working as Proprietor at Lalit Rajput &Associates, Company Secretaries and Compliance Head at EDUXGURU. Key areas include handling Compliances related to Secretarial, Start-ups, SEBI, FEMA, Labour Laws, GST, NCLT, IPR, MCA/ROC, RTA etc. He has started his career in Adventz Group with one of leading EPC Company, Kalindee Rail Nirman - A Div. Of Texmaco Rail & Engineering Limited (erstwhile known as Kalindee Rail Nirman (Engrs.) Ltd.) and after that worked with Outcome Solutions & Services LLP, a Risk Advisory firm and S. Srinivasan & Co.,Leading Company Secretaries firm in Mumbai and Chennai. He is also an active blogger/Author at many platform and has written various articles on: Taxguru, Compliance Calendar LLP, Studycafe, Caclubindia, Casansaar, theTaxTalk, Lawyer’s Connect, IPleaders, Governance Professionals, Lawyers club India, Dealout Professionals and many more. He has also blogger at ENLIGHTEN GOVERNANCE and contributed articles in ICSI E-Corporate Manager published by ICSI Ahmadabad Chapter.